Colorado Credit Card Surcharge Law

Colorado allows credit card surcharges, and it gives merchants a choice of two ways to measure the cap. A surcharge cannot exceed 2 percent of the total payment, or it cannot exceed your actual cost to process that transaction. The merchant picks which of the two methods it uses. Colorado does not tell a business which option to use, and neither do we; that call sits with your dealership and your accountant.

That cap comes from Colo. Rev. Stat. 5-2-212, enacted through SB21-091 and effective July 1, 2022. Before that date, Colorado banned credit card surcharging outright. As of July 2026 the two-option cap is the standing rule, unchanged since it took effect.

Colorado is one of 47 states where surcharging is legal. See the full table at credit card surcharge laws by state.

• Visa: 3% Cap

  Visa caps credit card surcharges at 3 percent nationwide.

• Mastercard: 4% Cap

  Mastercard caps credit card surcharges at 4 percent nationwide.

• Debit Never Surcharges

  Debit, prepaid, and gift cards can never carry a surcharge, and in Colorado that rule is written into state law too, not just network rules.

• Disclosure Is Mandatory

  Posted notice where customers see it, plus a separate line item on the receipt, every time.

Colorado banned credit card surcharging outright for years. SB21-091, signed into law in 2021, repealed that flat ban and replaced it with the two-option cap that governs today: a surcharge capped at 2 percent of the total payment, or capped at your actual cost to process the transaction, with the merchant choosing which method to use. The change took effect July 1, 2022, and it lives at Colo. Rev. Stat. 5-2-212. As of July 2026 the rule stands as written, and no court has struck it down or paused it.

The statute prescribes specific required notice wording for the surcharge sign. That notice has to be posted somewhere on the premises where customers can see it before they pay, or, for an online purchase, shown on screen before the customer completes checkout. The surcharge itself has to appear as its own separate line item on the receipt, distinct from the sale price. A business can only apply one credit card surcharge per transaction; it cannot stack a second fee on top.

The exclusions are written into the same state law, not just left to card network rules. Colorado bans a surcharge on cash, on checks, on debit cards whether or not a PIN is used, and on gift card redemptions. In most states, the rule that debit cards never carry a surcharge is a card network rule alone. In Colorado it is also state law, so the same answer is backed twice over.

Enforcement runs through Colorado's consumer credit code. A merchant that surcharges outside the cap or skips the required disclosure is in violation of that code, and the store is liable to the customer under it.

Colorado's cap gives you two ways to measure it. We track the state, not your front desk: disclosure at the entry, disclosure again before the customer pays, and the surcharge as its own line on the receipt, every time. Card-not-present payments run through the program with that same required disclosure. Debit never carries a surcharge, backed by both the network rule and Colorado state law, no exceptions.

Colorado Department of Revenue guidance from 2022 says a surcharge imposed under the statute is not part of the taxable purchase price for Colorado sales tax, as long as it appears as its own line item on the receipt and applies only to credit card payments. That guidance is general information, not binding, so your accountant gets the final word.

Payments post straight to the repair order in CDK Drive, so the surcharge line shows up where your advisors already work. See the full mechanics on the surcharge program page, or walk through exactly what happens at the terminal on the how it works page.